Criminal probe adds to Texas cancer agency's woes

AUSTIN, Texas — Texas put up $3 billion in taxpayer money and promised cancer breakthroughs. But a criminal investigation, widespread rebuke from scientists and the resignations of embattled state officials came faster than medical discoveries.

Bill Gimson, who resigned as chief executive of the Cancer Prevention and Research Institute of Texas, in an undated photograph. (AP Photo/Cancer Prevention and Research Institute of Texas)The Associated Press

The Cancer Prevention and Research Institute of Texas launched in 2009, flaunting the second-biggest trough of cancer research dollars in the country. Nobel laureates eagerly took jobs with the agency and celebrity Lance Armstrong lent visible and then-coveted support. It was an unprecedented state-run battle against a worldwide killer.

Three years later, it's become unhinged by suggestions of politics and personal profit and is on the ropes.

"People expected that we get some good results. Not that we make people rich in private companies doing cancer research," said Cathy Bonner, a cancer survivor who was a close aide to former Texas Gov. Ann Richards, and who helped brainstorm the idea for CPRIT. "I can't imagine anything lower than misuse of research money that's meant to save people's lives."

Embroiled by two lucrative grants approved despite scant review — or none at all, in one case — CPRIT is ending a year of turmoil saying the beleaguered agency is cooperating with separate prosecutor investigations. One is by a public corruption unit that convicted former U.S. House Majority Leader Tom DeLay on money laundering charges, and is beginning this probe trying to recover key internal emails CPRIT says it cannot retrieve.

The investigations opened last week after CPRIT revealed its latest and most serious blunder: Giving a private biomedical startup, Dallas-based Peloton Therapeutics, an $11 million award in 2010 without ever scrutinizing the merits of the company's proposal. The discovery came on the heels of the agency funding a $20 million project roundly condemned for not first undergoing an independent scientific review.

On Friday, the federal National Cancer Institute — which confers CPRIT the prominent status of being an approved funding entity — confirmed it was evaluating "recent events" at the state agency.

Amid the escalating troubles, an agency that doled out more than $800 million in three years has practically ground to a halt.

CPRIT's peer-review boards that evaluate research proposals are empty — virtually all members quit in protest, including the chief science officer and the head of the science review council, both Nobel prize winners. They didn't leave quietly: Dr. Phillip Sharp, professor at the Koch Institute for Integrative Cancer Research at the Massachusetts Institute of Technology, said agency leaders "dishonored" the integrity of the independent review process and suggested "suspicions of favoritism" were at hand.

On the other end of treating cancer — putting drug discoveries on the market and in the hands of patients — Chief Commercialization Officer Jerry Cobbs resigned in November after the irregularities behind Peloton's funding were uncovered. The agency has said Peloton was unaware its proposal bypassed review, and the company has declined comment.

Executive Director Bill Gimson then completed an extraordinary purging of the agency's leadership last week, saying he would step down from the $300,000-a-year job he held since CPRIT formed. His Dec. 10 resignation letter is dated the same day the Texas attorney general's office informed Gimson it was launching a wide inquiry into the agency's operations.

Months of upheaval has become even too much for one public relations superpower. Hill & Knowlton Strategies severed its consulting deal with CPRIT last week, telling the agency in a letter that "the ongoing issues and challenges that have confronted the organization over recent months have greatly exceeded the scope of work outlined in the original contract."

Cancer-fighting groups worry Texas lawmakers will be next to abandon CPRIT.

"The internal dynamics are concerning, and we need to know exactly what's going on," said James Gray, a government relations director for the American Cancer Society. "But the mission and work of CPRIT is vital in saving lives today, and also in the future."

CPRIT was created with a built-in expiration date. Texas voters approved a constitutional amendment in 2007 to launch a $3 billion cancer-fighting effort, but gave the state only a decade to do it. Apart from funding research in university laboratories and infusing private biotech startups with cash — including Peloton — the agency also provides money for hundreds of thousands of preventive screenings, such as for breast cancer, across Texas.

Gov. Rick Perry and other elected leaders are now talking tough about transparency and getting to the bottom of the Peloton grant. The state's key budget-writing committee added a review of the agency to a hearing agenda for Thursday, though there appears to be little appetite among lawmakers to cut off CPRIT.

Prosecutors launched their investigations last week without alleging any criminal misconduct. But their broad scope will include trying to recover internal agency emails surrounding the Peloton grant that Gimson has said are no longer available.

"We've been down that road many times," said Gregg Cox, director of the Travis County district attorney's public integrity unit.

CPRIT is among fewer than two dozen funding entities in the nation approved by the National Cancer Institute. Aleea Farrakh Khan, an NCI spokeswoman, said the institute has not directly contacted CPRIT during its evaluation and no decisions have been made.